ERA reduces electricity tariffs for the fourth quarter of 2021
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The Electricity Regulatory Authority (ERA) has approved the new Electricity End-User Tariffs to be charged by Umeme Limited for the supply of Electrical Energy in the Billing Period from October to December 2021, with a reduction of Tariffs for Consumers under the Commercial and Medium Industrial Categories.
The New Electricity End-User Tariffs indicate that Commercial Consumers will pay UGX 606.1 from UGX 616.6 and Medium Industrial Consumers will pay UGX 500.6 from 526.9.
The Tariffs for the rest of the Consumer Categories, namely Domestic, Large Industrial, Extra-Large Industrial and Street Lighting remain unchanged.
Domestic Consumers will continue to pay UGX 250 for the First 15 Units under the Lifeline Tariff and thereafter pay UGX 747.5 for the next Units purchased, Large Industrial Consumers will pay UGX 355.0, Extra Large Industrial Consumers will pay UGX 300.2 and Street Lighting Consumers will pay UGX. 370.0.
The approved Electricity End-User Tariffs represent a Weighted Average Reduction of 1 per cent, relative to the Tariffs of the Third Quarter of 2021.
According to the Chief Executive Officer of the Electricity Regulatory Authority, Eng. Ziria Tibalwa Waako, the reduction of Tariffs for the Commercial and Medium Industrial Consumers is a deliberate effort by the Electricity Regulatory Authority to support the Small and Medium-sized businesses to further recover from the adverse effects of the COVID-19 Pandemic, thereby contributing to the recovery of the economy.
The Tariffs for the period October to December 2021 are attributed to the following factors:
- Appreciation of the Uganda Shilling against the United States Dollar in the Third Quarter of 2021.The Exchange Rate of the Uganda Shilling against the United States Dollar appreciated by 0.3%, from Ush 3,546.0/USD as at 31st May 2021 to Ush 3,535.04 as at 31st August 2021. The Exchange Rate of the Uganda Shilling against the United States Dollar also appreciated by 4.4% from the 2021 Base Exchange Rate of Ush 3,699.17/USD in November 2020.
- Increment in International Fuel Prices. The International Fuel Price for Crude Oil for August 2021 was USD 70.33 Per Barrel compared to USD 40.08 Per Barrel used in the determination of the 2021 Base Tariffs. This represents an increase in the International Fuel Prices by 75.5% from the Base Period.
- The Total Quarterly Energy expected to be purchased by UETCL which is 1,248.5 GWh.
- The Water Release at the Nalubaale/Kiira Generation Complex which is projected at 1,000 Cubic meters per second (cumecs) for the Fourth Quarter of 2021, which translates into an Average Generation Capacity of 172.7 MW from Nalubaale/Kiira and 178.8 MW from Bujagali Energy Limited.
The New Tariffs apply to all Electricity Consumer Bills raised by Umeme Limited, based on Meter Readings and Yaka purchases taken in the period October to December 2021.
In line with the Quarterly Tariff Adjustment Methodology that was approved by ERA in 2014, the Authority sets out an Annual Base Tariff at the beginning of each calendar year. The Base Tariff is adjusted by ERA on a Quarterly basis to provide for changes in the Macro-Economic factors, namely: The Consumer Price Index, the Exchange rate of the Uganda Shilling against the United States Dollar, International Fuel Prices, and the Energy Generation Mix from the assumptions used in the determination of the 2021 Base Tariffs.